Posted May 4, 2009

One of the key tools in every sales pro’s toolbox should be an objective targeting methodology. Smart sales pro’s know that all prospects are NOT created equal. To get the greatest return on your investments of time, effort, and resources you generally need to focus on the prospects that will provide the greatest return once they become customers.

An easy method that I’ve seen used with great success is to graph two data points on intersecting axes for each prospect (trust me, its easier than it sounds):
Data point 1 = Total dollars the customer spends in the market (market = yours and all competing products, in this case).
Data point 2 = Market Share or The percentage of sales dollars in your product

Decide where the two axes cross based on your specific product and market.

This gives you a graph with four quadrants that I like to think of as stalls at a zoo. In each stall is a different kind of animal. Why animals? Why not? It keeps me entertained.

1) Hipos
These are your High Potential accounts (Hi-po). They use a large volume of product in the market, but a low percentage of your product. Convert them and you win big.

2) Cash Cows
These are your money makers. They use a high volume of product in the market, and a high percentage of YOUR product. Keep them happy, they are your competitions Hipos.

3) Mules
These folks use a high percentage of your product, but are low in total market volume. Depending on your product, these could account for a lot of cumulative sales, but their impact as individuals is small, so you can’t afford to give them too much attention, else you risk neglecting your Hipos and Cash Cows.

4) Dogs
No offense to “man’s best friend”, but this is the group that you pretty much need to ignore. Dogs do a low volume of business in the market and a low percentage of that volume is in your product. We are running businesses, and it is generally nearly impossible to get a positive ROI on your Dog accounts.

Try out this method of segmenting and targeting your accounts and let me know what you think.

How do you segement your accounts?

Jeff Cress, the Sales Guy

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